Posted
by
msmash
on Thursday May 17, 2018 @02:10PM
from the red-flag dept.

Investors have sent $1 billion into digital coin projects that flash warning signs for fraud, The Wall Street Journal reported Thursday. The revelation comes a day after the SEC created its own fake ICO to teach investors a lesson. From a report: In a review of 1,450 digital coin offerings, the Journal said it found 271 bore red flags such as plagiarized documents or fake executive information. Investors have already claimed losses of up to $273 million in these projects, the newspaper said, according to lawsuits and regulatory actions. The coin sales, or "initial coin offerings," give investors the chance to buy into a new digital token while letting developers get easy access to funding. The process may be a little too easy for many projects that are unproven or outright scams.

Coin offerings have raised roughly $9.8 billion in the two years through mid-March, according to financial research firm Autonomous Next. The Journal found widespread plagiarism in 111 projects' online whitepapers, including word-for-word copies of marketing plans and technical features.

More and more all these various 'cryptocurrencies' are starting to remind me of the 'limited edition gold coins' and 'collectible coins' sold on the x.2 and x.3 (and so on) broadcast TV channels. They're not really worth more than the metal they're made out of but they try to convince you they're going to be worth orders of magnitude more than you're paying for them.

More and more all these various 'cryptocurrencies' are starting to remind me of the 'limited edition gold coins' and 'collectible coins' sold on the x.2 and x.3 (and so on) broadcast TV channels. They're not really worth more than the metal they're made out of but they try to convince you they're going to be worth orders of magnitude more than you're paying for them.

Actually, a lot of them are real. Just you can buy them from the Fed for about 1/5th the cost normally. They are only "collectible" in the sense someone paid a lot of money to make an ad for them thinking you can only get it from them. But your local bank should be able to order in a roll for you for basically face value (they may be gold coins, but the gold content is nowhere near their face value). So the ad might sell you a roll of 20 $1 gold coins for $100 as "collectible" (they are limited - once the feds stop pressing, they're no more). Or you bank can get them for $20 or so.

Of course, it also plays on the "limited" part and "collectible" part. Just because something is limited, rare, or collectible, doesn't make it valuable. After all, the Fed just prints a new coin the next year and the scam repeats again.

You know what I am hearing, 'watch the fuck out the end is nigh'. This sounds like the typical press release media backup and corporate support for a war. That increasing frequency of targeted news, associations of threat and imminent major harm. The other against whom a war must be fought, the other in this case, 'unbacked crypto currencies'. It seems like the decision has most definitely been made and the preliminaries are being deployed with a view to action taken which would have a zeroing affect on wor

I have this terrible feeling in my gut that all this speculation will incite yet another banking crisis. In order to avoid complete devastation, the government will do a bailout.

Guess who gets to pay for the speculators losses . . . ?

People were using this tax scam long before ICOs...

To partially counteract this, the IRS limits passive loss write-off to at most the passive gains you report in a tax year. This means you could avoid paying about 1/2 the taxes on your legitimate investments in the best case...

Why 1/2? Because you could taken that money you used to declare a loss and invested it in your actual investments and presumably doubled the gain.

Are (any) fiat-currency and (any) cryptocurrency really equivalent, as cryptocurrency fans claim?For example, US Dollar and Bitcoin are really equals?Value/validity/authorization of US dollar is provided/guaranteed by US Government (and in-turn whole US Public)!Also, not to mention, US Dollars in any US Bank is insured by US Government!What authorization/guarantee/insurance is behind Bitcoin? Nothing!Sorry but that is the end of discussion then!

Why do you think Satoshi Nakamoto is really hiding his identity, if Bitcoin is really such a great innovation?He is just someone does not like media/fan attention?Or, could it be really because Bitcoin (and all cryptocurrencies followed it) are actually Ponzi Schemes?(So he knew very well that law enforcement would come after him sooner or later?!)

If so-called cryptocurrencies are really good innovation, why they attract so many criminals/criminal activity?Could it really be because, all cryptocurrencies themselves are scams, and that is why they attract all kinds of criminals/criminal activity?

If so-called cryptocurrencies are really currency, why no company/store can use Bitcoin as currency anymore?Because the price of Bitcoin proved to be extremely unstable to use as a currency?Would the result be different, if Bitcoin replaced by any other "cryptocurrency"?Aren't all work the same way?

If so-called cryptocurrencies are really money; isn't people issuing their own money, illegal already, in all countries?If so then, why they are still not banned in all countries?

Or, they are not actually virtual currency but virtual investment?But, if they are actually investment, why we need/want them?What would happen to world economy, if people invested in virtual investments, instead of real investments?

Or, all so-called cryptocurrencies are actually just a modified (made decentralized and paying variable interest) Ponzi Schemes?(Price of cryptocurrencies would keep increasing in the long term (by their design), so it is equivalent of paying variable interest to all long term investors.)

As more and more people invest in cryptocurrencies, it will become harder and harder to ban their trading everywhere!All cryptocurrencies need to be banned globally before it is too late!

(A) Forking is a kind of "printing" on a whim. It is obviously true about any soft fork. It is arguably true about a hard fork, too.(B) New cryptocurrencies can very easily be printed, and all can potentially directly compete with Bitcoin (in a way that Mexican pesos will never directly compete with the USD).

I interrupt the regularly scheduled nay-saying and fun-poking for a question.

Are there any real, legitimate crypto-coins that got started by an initial offering?

I'm not Bitcoin expert, but my impression was you can only get coins from "Bitcoin" through mining. Private parties will sell bitcoin or exchange them for goods and services, but if you want coin directly from "Bitcoin" or where ever coins originate, to be the first owner of a bitcoin, you must mine it. You cannot buy it.

I'm really disappointed to see this is actually true, as seen at Coinmarketcap (specifically, the "not mineable" marker). However, legitimacy is rather subjective here. With Ethereum for example, it's relatively easy to set up your own system of tokens that piggyback on another blockchain. So the number of useless coins is easily inflated to skew the statistics.

Of course, it's likewise possible to fork Bitcoin into yet another useless but technically legitimate altcoin. But with Ethereum it's doubly ques

This is largely why I stick with CureCoin. I get a few coins inreturn for letting my gear fold proteins and do God-knows-what other medical research for the Folding@Home team. I'm more interested in contributing to research, but if they want to give me the crypto-equivalent of a beer every couple of weeks, I'm a happy guy.

The part of this that makes me squirm is that I actually heard a home equity lender advertising that you could borrow to play the latest crypto currency... So it could be BOTH crypto currency AND real-estate at the same time.

It could be bad. Hold onto your cash and be ready to buy on the dip... Not Crypto you dolts, Real Estate, buy Real Estate...